Estimate the real cost of a working capital loan or merchant cash advance after upfront fees.
Advanced options
Table of contents
How to use our Working Capital Loan Calculator
- Choose the Funding type shown in your offer: Fixed-rate loan or Merchant cash advance.
- Enter the Funding amount, then fill in the rate and time fields that match that Funding type.
- Open Advanced options if the offer deducts an Upfront fee or Fixed upfront fee before you receive the money.
- Select Calculate and read the first cards first: Total borrowing cost after upfront fees, Borrowing cost per $1,000 received, and Cash received after upfront fees.
- Sanity-check the estimate by comparing Cash received after upfront fees with what you need, and by testing a lower Monthly card sales amount for an MCA if sales may slow down.
Definitions
Funding amount: The face amount listed in the offer before any deducted upfront fees.
Fixed-rate loan: A loan with a set annual rate, set term, and equal monthly payments in this calculator.
Merchant cash advance (MCA): Funding repaid from a share of future card sales, often priced with a factor rate instead of a standard interest rate.
Annual interest rate: The yearly interest rate used to calculate the fixed-rate loan payment.
Factor rate: The multiplier used for an MCA. A 1.25 factor rate means total repayment is 1.25 times the funding amount.
Holdback from card sales: The percent of monthly card sales withheld to repay an MCA.
Upfront fee: A percent fee deducted from the Funding amount at the start.
Fixed upfront fee: A flat dollar fee deducted from the Funding amount at the start.
Cash received after upfront fees: The estimated cash available to the business after deducted upfront fees.
Borrowing cost per $1,000 received: The fee-inclusive cost scaled to each $1,000 of cash received, so different-size offers are easier to compare.
Common mistakes and quick fixes
Mistake: Using the amount you need as Funding amount when the offer deducts fees.
Fix: Enter the offer's full Funding amount, then enter Upfront fee and Fixed upfront fee so Cash received after upfront fees shows the usable cash.
Mistake: Typing a monthly rate into Annual interest rate.
Fix: Enter the yearly Annual interest rate from the fixed-rate loan offer, such as 12 for 12% per year.
Mistake: Leaving Loan term in years instead of months.
Fix: Convert the Loan term to months, such as 2 years = 24 months.
Mistake: Comparing Factor rate with Annual interest rate as if they mean the same thing.
Fix: Use Merchant cash advance mode for Factor rate, then compare Borrowing cost per $1,000 received instead of the rate labels.
Mistake: Entering total business revenue as Monthly card sales.
Fix: Use Monthly card sales that are subject to the Holdback from card sales, not cash, checks, or invoices that are not withheld.
Mistake: Ignoring Estimated monthly withheld from card sales when cash flow is tight.
Fix: Compare Estimated monthly withheld from card sales with your normal card-sales cash flow before accepting the offer.
Limitations & Key Assumptions / Boundary Conditions
- Fixed-rate loan mode assumes a fully amortizing loan with equal monthly payments, a fixed annual rate, and no balloon payment.
- MCA mode estimates payoff time from Monthly card sales and Holdback from card sales. If card sales rise or fall, the actual payoff time changes.
- Upfront fee and Fixed upfront fee are treated as deducted from funding at the start. If fees are financed instead, real payments can differ.
- The calculator does not include late fees, prepayment penalties, renewal fees, variable rates, legal costs, taxes, or required reserve accounts.
- Borrowing cost per $1,000 received is a simple dollar-cost comparison. It is not an APR and does not adjust for daily or weekly payment timing.
- The fixed-rate loan payment schedule is rounded for display, so the final row may be adjusted slightly to avoid a negative ending balance.
Methodology
Fee and cash received math
The calculator first estimates fees deducted at funding, then calculates the cash the business actually receives.
upfront_fees = funding_amount * origination_fee_percent / 100 + fixed_upfront_fee
cash_received = funding_amount - upfront_fees
If cash received is $0 or less, the estimate stops because the cost per $1,000 received would not be meaningful.
Fixed-rate loan math
Fixed-rate loan mode uses standard monthly amortization. The annual rate is divided by 12 to get the monthly rate.
monthly_rate = annual_rate / 100 / 12
if monthly_rate = 0, monthly_payment = funding_amount / term_months
otherwise monthly_payment = funding_amount * monthly_rate / (1 - (1 + monthly_rate)^(-term_months))
total_repayment_before_upfront_fees = monthly_payment * term_months
total_interest_before_fees = total_repayment_before_upfront_fees - funding_amount
The payment schedule starts with the current balance, calculates that month's interest, applies the rest of the payment to principal, and carries the ending balance to the next row.
interest_part = starting_balance * monthly_rate
principal_part = monthly_payment - interest_part
ending_balance = max(0, starting_balance - principal_part)
MCA math
Merchant cash advance mode multiplies the funding amount by the factor rate to estimate total repayment. It estimates monthly withholding from card sales and the holdback percent.
total_repayment_before_upfront_fees = funding_amount * factor_rate
estimated_monthly_withheld = monthly_card_sales * holdback_percent / 100
estimated_payoff_months = total_repayment_before_upfront_fees / estimated_monthly_withheld
Cost comparison math
For both funding types, the headline cost output compares what you repay with the cash you actually receive after deducted fees.
total_borrowing_cost_after_fees = total_repayment_before_upfront_fees - cash_received
cost_per_1000_received = total_borrowing_cost_after_fees / cash_received * 1000
A lower cost per $1,000 received means the offer costs less for the same amount of usable cash, assuming the listed inputs match the offer.
Mini-example
For a $50,000 fixed-rate loan at 12% for 24 months with a 3% upfront fee and a $500 fixed upfront fee, upfront fees are $2,000 and cash received is $48,000. The monthly payment is about $2,353.67, total repayment is about $56,488.08, total borrowing cost after upfront fees is about $8,488.08, and borrowing cost per $1,000 received is about $176.84.